RI ESG Briefing, April 24: New intergovernmental biodiversity body established

Environmental

A new intergovernmental body has been set up to accelerate the global response towards the sustainable management of the world’s biodiversity and ecosystems. The new Intergovernmental Platform on Biodiversity and Ecosystem Services (IPBES) will be hosted by former German capital Bonn. IPBES site
US banking giant Wells Fargo has announced an “enhanced commitment” to environmental leadership. Among its goals are $30bn in loans and investments supporting a “greener” economy, $100m in community grants for grassroots environmental initiatives, and a 40% increase in the company’s energy efficiency.

It has emerged that institutional investors seven times oversubscribed last year’s €1bn bond issue by TenneT, the Dutch grid operator involved in Germany’s transition from nuclear power to renewables. A spokesman said they could have included banks, pension funds and hedge funds.

The Nordic Investment Bank and Norwegian energy company E-CO Energi, owned by the Municipality of Oslo, have signed a NOK300m (€39m) loan to help finance three hydropower projects. The investments include the construction of a new dam, four new aggregates and a new hydropower plant. Announcement

Social

UKSIF, the UK Sustainable Investment and Finance Association, has backed the Natural Capital Declaration, the financial sector initiative on integrating environmental criteria into financial products and services. UKSIF is also backing the Corporate Sustainability Reporting Coalition, which is seeking a global convention on corporate sustainability reporting at Rio+20.
There’s been a fall in the number of male-only FTSE 100 boards, according to the new Cranfield Female FTSE Report. The business school said the number of female-held FTSE 100 directorships has risen to 16% and the number of all-male boards has fallen from 11 to nine. There are now 153 women holding 176 FTSE 100 board seats.

The International Council on Mining and Metals (ICMM) has launched guidance on integrating human rights due diligence into corporate risk management. It aims to assist mining companies in reviewing their existing risk management processes, identifying how they can build on them to ensure they are adequately addressing human rights and whether their existing processes are consistent with the UN Guiding Principles.h6. Governance

Hermes, the fund firm that’s owned by the BT Pension Scheme, has called for shareholders to vote against a resolution at Deutsche Bank’s annual meeting discharging the supervisory board’s performance for 2011, according to a Financial Times report. The bank holds its AGM in Frankfurt on May 31.

Swiss pension fund-owned advisory firm Ethos has advised shareholders to oppose the Credit Suisse remuneration plan at the bank’s annual meeting on April 27. Ethos was also critical of Credit Suisse’s executive bonus system called PAF2, according to a Reuters report.

Ohio Attorney General Mike DeWine has filed a lawsuit against BP on behalf of four of the state’s pension funds – the Ohio Public Employees Retirement System, the State Teachers Retirement System of Ohio, the School Employees Retirement System of Ohio and the Ohio Police and Fire Pension Fund. It claims the oil major “misrepresented information about its safety practices and procedures before the Deepwater Horizon explosion” in April 2010.

Meanwhile, the state of Oregon has also sued BP for losses of almost $19m suffered by the $57bn Oregon Public Employees Retirement Fund, as a result of Deepwater Horizon, according to a report in Pensions & Investments.
Trillium Asset Management, the US responsible investing firm with $1bn in assets under management, has released the comments it made to the Consumer Financial Protection Bureau’s hearing on payday lending. “Payday lending, in its current form, is corrosive to healthy economic development and poses significant risks to diversified investors,” the firm said. Link

Hector Sants, the outgoing head of the UK’s Financial Services Authority, has addressed the role of regulators in corporate governance in his final speech in the role. Noting “insufficient progress” in corporate governance since the financial crisis, Sants called for strong ethical frameworks and for decisions made “in relation to principles rather than just short-term commercial considerations”. He called for financial firms to give greater weight to non-financial metrics, particularly fair treatment of customers, in determining pay.

The Financial Reporting Council, the UK watchdog, has launched a consultation on proposed revisions to the 20-year-old Corporate Governance Code and on updates to the Stewardship Code. The latter seek clarity on the term ‘stewardship’ and on the responsibilities of asset owners and fund managers.